Measuring the Success of Your Software Development Projects

Successful software development projects aren’t determined by any one factor.

There are countless metrics you can use to measure the impact of software projects—depending on your business goal and what questions you’re trying to answer.

In this post, we’ll show you how to measure the success of a project from a few different angles by sharing some examples of KPIs that help evaluate your initiatives.

What is Project Success? It Depends

Software development metrics must link to clear goals that align with your initial use case. In other words, what were you hoping to achieve going into this process?

The KPIs you choose depend on your goal and the specific questions that can help you understand what worked and what didn’t.

They also measure success across different areas: alignment with project goals, how well developers meet the initial requirements, and the value the end-product creates for your company and its consumers.

The challenge is, “value” or “quality” can be measured in different ways: usability, reliability, structural integrity, and so on.

Essentially, it’s best to think of metrics as a tool for testing hypotheses that both support a specific goal and provide answers that help you drive improvements. If you can’t do anything with the information, it’s not worth measuring.

A recent article from CIO Dive brings up another important point: big improvements require a commitment to big data.

While companies are ramping up investments in data collection and analytics tools, many fail to look beyond the most obvious metrics (think churn, sales, etc.) and apply too narrow an approach to “unlock the value” hidden in their data.

Failing to collect enough data is only part of the problem.

Businesses need to do a better job ensuring that business functions and data teams are in alignment around what metrics they’re tracking and why.

Developers, product teams, sales, etc., should be part of the strategy from the beginning—that way, there’s consensus around what success looks like for a particular project.

Here’s a look at how to measure the success of a project against a few different goal types—though it’s worth mentioning, focusing on one set of software development metrics will only tell you one part of the story.

Business Performance

Business performance metrics focus on measuring things like revenue, customer lifetime value, bookings, expenses, etc.— which can help you understand whether your project is helping your business grow.

The following metrics can help you understand how successful software development projects impact the bottom line:

• Retention rate/churn
• Number of active users (daily, weekly, monthly)
• Customer acquisition rate
• Conversions
• Customer lifetime value (CLV)
• Monthly recurring revenue (MRR)

Business performance, or revenue, metrics are the most obvious method of measuring project success. Note that they don’t help you understand why it was successful or which factors had the greatest impact on its overall success.

Customer Satisfaction

Customer satisfaction metrics help you understand your team’s ability to meet end-user expectations and how that correlates with brand perception.

You might track the following metrics to measure satisfaction:

• Support ticket themes
• NPS, CSAT scores
• Feature sentiment
• Finally, you’ll want to track satisfaction over time to ensure you keep improving.

According to a recent McKinsey report, executives are increasingly finding that CX surveys are failing to support their actual CX needs. 93% said they use survey metrics like NPS or CSAT as their primary tool for measuring performance—yet only 15% said they were completely satisfied with their method.

Survey metrics do capture important information. But focusing on these metrics alone relates directly to the last point: brands are thinking too small and too obvious to deliver any meaningful improvements.

Instead, make sure you’re looking at a wide range of data sets. There’s no shortage of customer-related insights available—be it in the form of brand mentions, chatbot conversations, behavioral data, support tickets, reviews.

3Pillar’s Henry Martinez also suggests tracking “schedule adherence and quality metrics—from the customer’s point of view. Perception will follow reality. They need to believe it before it is “true.””

Essentially, you’re trying to determine whether your ability to release products on time (or faster than anticipated) and consistently deliver high-quality products has any measurable impact on satisfaction.
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Product Engagement

According to 3Pillar’s Eddy Vidal Nunez Garcia, “a project can achieve all requirements in terms of cost and deliverables, but if it doesn’t have an impact in the market, it’s a failure. The best metric above all is whether it resonates with customers.”

Obviously, “impact on the market” includes satisfaction and sales metrics, too, but KPIs measuring product engagement are one of the most effective ways to determine the most important marker of success: whether you’ve managed to build something useful your customers truly love.

These metrics help you understand how customers use your product. Use them to answer questions like:

Are customers using some features more than others?
How often are they logging in?
Are they completing onboarding steps? If not, where do they drop out of the process?

Examples include:

• User adoption
• Percentage of new users that completed onboarding
• Usage/time spent in app
• Number of actions/sessions

These KPIs help you identify customers who may be at risk of churning by pointing out red flags like incomplete onboarding, unused features, or sudden drop-offs in usage. On an individual level, these metrics can highlight which users need hands-on guidance from a sales or service rep—and big-picture, they can help your development team identify and fix friction points for a smoother experience moving forward.

Agile Metrics

Agile metrics measure how well teams plan and make decisions.

While they don’t tell you whether the software itself had any impact on your strategic goals, they are useful for improving the development process—which in turn, improves the quality of their output.

Examples include:

• Lead time
• Velocity
• Cycle time
• Impact of code changes on the software development project
• Open/close rates
• Mean time between failures

If any of these KPIs fall outside of the expected range or indicate that the team is moving in the wrong direction, it’s crucial to talk to the team before acting on any assumptions you might have about the situation.

Find out the whole story and work together to come up with a solution—if a solution is even necessary.

Agile metrics can’t help you identify a root cause, but they can help you identify areas that need attention and start a conversation about how to best move forward.

Deliverables

According to 3Pillar’s Abel Gonzalez Garcia, “the best software development metrics validate whether the project’s objectives have been accomplished. Then, we can compare the effort we put into our initial estimate.”

If your goal is measuring how efficiently development teams are working, you’ll want to focus on deliverables.

These metrics work best if you’re trying to bring (quality) software products to market faster. Use them if you want to learn more about what’s causing delays, identify opportunities for automation, or if your team is making mistakes that require rework.

• Total output
• On-time delivery
• Number of features deployed
• Tasks completed
• Bugs fixed
• Code churn
• Active days
• Impact of code changes
• Mean time to recover
• Mean time between failures

It’s critical to work with team leads/project managers to define what successful software developments look like from a productivity standpoint. It’s also essential that you share these decisions with the entire team, offering specific parameters for achieving success within the context of their individual roles and responsibilities.

On their own, productivity KPIs aren’t the most useful software development metrics. There’s a real risk that business leaders will focus too much on output rather than outcome. That said, these metrics can help organizations improve their management strategy, recognize individual achievements, and identify specific ways to improve—and as a result, deliver better products to market faster.

Final Thoughts

Ultimately, measuring project success means looking at each factor contributing to the greater whole.

It’s important to understand that this can’t be done (at least not effectively) in one report—instead, you’ll need to focus on one objective at a time to measure its true impact—and identify specific, actionable opportunities for improvement next time around.

3Pillar’s software developers and engineers approach projects with a laser focus on client outcomes. In other words, they’re all about measuring the impact of their efforts and using insights to drive lasting improvements.

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